The company has also taken several measures to mitigate the downside risks by hedging its commodities and foreign exchange rate, according to him.

Wang, who is also the chairman and general manager of Hengyuan Refining's parent company Shangdong Hengyuan Petrochemical, believed the parent company's experience in technological upgrades and oil market fluctuations management have had some positive impacts on Hengyuan Refining in upgrading products and risks management.

However, to him, international oil price volatility is complex as it is subject to the risks of geopolitics and the supply-demand relationship.

"We will continue to adjust Hengyuan Refining business strategy based on market fluctuations and consolidations, in order to maximize benefits of its existing resources," Wang said.

Formerly known as Shell Refining Company (Federation of Malaya) Bhd, Hengyuan Refining has returned to profit in the third quarter ended September 2017, posting a net profit of 361.78 million ringgit (88.69 million U.S. dollars), compared with the net loss of 80.86 million ringgit in the previous year on improved gross profit margins and foreign currency exchange gains.

Another catalyst to the company is the inclusion of MSCI Global Small Cap Indexes, and FTSE Bursa Malaysia Mid 70 Index last month. Over the past 12 months, the stock has surged more than seven times to 15.06 ringgit (as of noon time on Tuesday) from 2.06 ringgit after the emergence of new shareholder Shangdong Hengyuan Petrochemical.

Areca Capital's chief executive Danny Wong Teck Meng also told Xinhua, there are only few refinery stocks in Malaysia, investors may see this an opportunity for Hengyuan.

Both opined that the oil and gas industry had a good year after oil prices rebounded.

Going forward, Wang said, Hengyuan Refining will focus on consolidating its technology-leading position in Malaysia, preparing the refinery for Euro 4M and continuing to improve its operational efficiency.

The Euro 4M Project, which is in progress, aims to supply Malaysia with motorcar gasoline (mogas) of Euro 4 specifications to replace Euro 2 currently in use. It has also been designed to comply with Euro 5 specification.

"We are working with suppliers to expedite the delivery of long lead items and taking measures to mitigate the risk of further delay," he said.

The Euro4M Mogas plant that incurred a total investment of 135 million U.S. dollars was initially planned to complete by the second half of 2018. Upon completion, this upgrade will allow the group's Port Dickson refinery to produce up to 1.15 million tons of gasoline per annum.

Meanwhile, Hengyuan Refining will actively seek commercial opportunities to open up other markets in South East area apart from supplying to its local partner Shell.

With new and alternative energy emerging and in order to build a base for Hengyuan Refining's potential expansion in the downstream business, we will also keep an eye on market development," he added.

"It seems that investors' confidence over Hengyuan Refining has increased. We will continue our commitment to improve profitability and create higher returns for investors," Wang said.

The challenge for him now, however, is the integration of the Shell culture and that of Hengyuan. "To optimize, we have to extract and combine the two cultures and create a unique and competitive corporate culture of Hengyuan Refining," said Wang.

Reuters

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